Working Paper: CEPR ID: DP12561
Authors: Nagore Iriberri; Iigo Hernandez-Arenaz
Abstract: A laboratory study was carried out to analyze the relationship between ambiguity regardingthe sharing norms in structured alternating-offer bargaining and gender differencesin bargaining. Symmetric environments, where a 50:50 split emerges as the unique sensiblenorm, showed the lowest ambiguity and gender differences were absent. We increasedambiguity by introducing asymmetries into the bargaining environment by making onebargaining party get a higher share than the other (due to empowerment, entitlement orinformational asymmetries), but without imposing new sharing norms. In these situations,men were less likely to reach an agreement, but, when they did, they obtained a larger share of the pie. As a result, men and women showed similar overall earnings but earningswere lower when bargaining with men. We found suggestive evidence that gender differencesdiminished when we reduced ambiguity regarding the sharing norms by providinginformation about other participants’ agreements in asymmetric environments.
Keywords: gender differences; bargaining; experimental study
JEL Codes: C91; J16
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| ambiguity (D84) | gender differences in bargaining outcomes (C79) |
| asymmetries (D50) | gender differences in bargaining outcomes (C79) |
| low ambiguity in symmetric environments (D80) | absence of gender differences in bargaining outcomes (C79) |
| high ambiguity in asymmetric environments (D80) | lower likelihood of men reaching an agreement (J52) |
| high ambiguity in asymmetric environments (D80) | larger share of the pie for men when they reach an agreement (C78) |
| disclosure of past agreements (L14) | reduced gender differences in bargaining outcomes (C79) |